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Zumiez (ZUMZ) Lined Up for Q3 Earnings: What to Expect

Zumiez (ZUMZ) third-quarter fiscal 2021 earnings results might show the ill effects of higher costs, including SG&A. However, ZUMZ's omni-channel capabilities comprising store initiatives look good.

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This story originally appeared on Zacks

Zumiez Inc. ZUMZ is likely to post a decrease in the bottom line from the year-ago quarter’s reported figure when it announces third-quarter fiscal 2021 earnings on Dec 2, after the closing bell. The Zacks Consensus Estimate for quarterly earnings is pegged at $1.07, suggesting a decline of about 8% from the year-ago period’s tally.

A glimpse of this Lynnwood, WA-based player’s performance shows that the same delivered a significant positive earnings surprise in the trailing four quarters, on average.

The Zacks Consensus Estimate for the quarterly revenues is pegged at $288.4 million, indicating an increase of 6.4% from the prior-year period’s reported figure.

- Zacks

Key Factors to Note

Zumiez’s customer-centric business model, differentiated product assortments and improved omnichannel solutions are likely to have favorably impacted its top-line performance in the fiscal third quarter. ZUMZ seems well-poised to capitalize on the trends in the apparel space on the back of its one-channel concept and advanced in-store fulfillment capabilities.

ZUMZ’s strategy to optimize its store base, including expansion in the underpenetrated markets looks appealing. These strengths coupled with its efforts to meet robust demand for the distinct merchandise offering might have contributed to its performance in the to-be-reported quarter. Zumiez’s men’s, accessories and footwear categories are performing well.

On its last earnings call, management had projected results to surpass the fiscal 2020 sales levels during the second half of fiscal 2021. It had also stated that the fiscal third quarter is off to a strong start owing to a more normalized back-to-school shopping season. Evidently, total sales for the 37 days ended Sep 6, 2021 climbed 23.2% from the same-period level ended Sep 7, 2020. Also, total net sales rose 6.7% from the same-period reading in fiscal 2019. Total comparable sales for the 37-day period grew 10.5% year over year and 5.4% from the number achieved in the comparable period of fiscal 2019.

On the flip side, Zumiez has been witnessing higher SG&A costs for a while now. Deleveraged store wages, higher annual incentive compensation, decline in governmental subsidies, elevated marketing events and other related spending might have been deterrents. Also, the pandemic-related uncertainties cannot be ruled out.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Zumiez this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

 

Zumiez Inc. Price and EPS Surprise

Zumiez Inc. Price and EPS Surprise

Zumiez Inc. price-eps-surprise | Zumiez Inc. Quote

Although Zumiez has a Zacks Rank #3, its Earnings ESP of 0.00% makes surprise prediction difficult.

Stocks With Favorable Combination

Here are some companies you may want to consider as our model shows that these have the right combination of elements to beat on earnings this season:

lululemon athletica LULU currently has an Earnings ESP of +1.44% and a Zacks Rank of 2. LULU is expected to register top and bottom-line growth when it reports third-quarter fiscal 2021 numbers. The Zacks Consensus Estimate for LULU’s quarterly revenues is pegged at $1.43 billion, suggesting growth of 28.1% from the prior-year quarter’s level.

The Zacks Consensus Estimate for lululemon’s quarterly earnings has moved a penny up in the past 30 days to $1.39 per share, suggesting a 19.8% increase from the year-ago reported number. LULU delivered an earnings beat of 25.2%, on average, in the trailing four quarters. You can see  the complete list of today’s Zacks #1 Rank stocks here.

PVH Corp. PVH currently has an Earnings ESP of +1.61% and a Zacks Rank #2. PVH is expected to register top- and bottom-line growth when it reports third-quarter fiscal 2021 results. The Zacks Consensus Estimate for quarterly earnings of $2.07 per share suggests growth of 56.8% from the year-ago quarter’s reported figure.

The consensus mark for PVH Corp.’s quarterly revenues is pegged at $2.40 billion, indicating an increase of 13.4% from the figure reported in the year-ago quarter. PVH has a trailing four-quarter earnings surprise of 177.5%, on average.

Costco COST currently has an Earnings ESP of +1.00% and a Zacks Rank of 3. COST is likely to register top- and bottom-line growth when it reports first-quarter fiscal 2022 numbers. The Zacks Consensus Estimate for quarterly earnings has moved 2.8% north in the past 30 days to $2.59 per share, suggesting an improvement of 13.1% from the year-ago quarter’s tally.

The Zacks Consensus Estimate for Costco's quarterly revenues is pegged at $49.6 billion, suggesting growth of 14.8% from the figure reported in the prior-year quarter. COST delivered an earnings surprise of 7.7%, on average, in the trailing four quarters.



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Zumiez Inc. (ZUMZ): Free Stock Analysis Report

 

Costco Wholesale Corporation (COST): Free Stock Analysis Report

 

lululemon athletica inc. (LULU): Free Stock Analysis Report

 

PVH Corp. (PVH): Free Stock Analysis Report

 

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